Axonics Reports Third Quarter 2024 Financial Results

AXNX 11.07.2024

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    IRVINE, Calif.--(BUSINESS WIRE)--Nov. 7, 2024--Axonics, Inc.(Nasdaq: AXNX), a medical technology company that develops, manufactures and commercializes innovative and minimally invasive products to treat bladder and bowel dysfunction, today reported financial results for the three months endedSeptember 30, 2024.

    “Axonics continued to execute at a high level in the third quarter, generating revenue growth of 25% year over year,” saidRaymond W. Cohen, chief executive officer. “Revenue growth for both sacral neuromodulation and Bulkamid®was driven by higher utilization at existing customers and the onboarding of new accounts.”

    Mr. Cohencontinued, “Our commitment to innovation, quality, direct-to-consumer advertising and providing strong clinical support continues to expand the market for life-changing incontinence therapies and propelAxonicson its path to market leadership. We look forward to the global impact theAxonicsportfolio can make as part of Boston Scientific as we endeavor to treat more patients than ever before.”

    Third Quarter 2024 Financial Results

    • Net revenue was$116.2 million, an increase of 25% compared to the prior year period.
      • Sacral neuromodulation revenue was$92.3 million, an increase of 25% compared to the prior year period.
      • Bulkamid revenue was$23.8 million, an increase of 25% compared to the prior year period.
    • Gross margin was 77.2% compared to 74.2% in the prior year period.
    • Loss from operations was$6.3 millionand includes$8 millionof one-time legal and acquisition-related costs. This compares to a loss from operations of$0.7 millionin the prior year period.
    • Net loss was$21,000compared to net income of$3.9 millionin the prior year period.
    • Adjusted EBITDA was$23.6 millioncompared to$14.0 millionin the prior year period.
    • Cash, cash equivalents, short-term investments and restricted cash were$367 millionas ofSeptember 30, 2024.

    AboutAxonics

    Axonicsis a global medical technology company that is developing and commercializing novel products for adults with bladder and bowel dysfunction.Axonicsranked No. 2 on the2023Financial Timesranking of the fastest growing companies in theAmericasafter being ranked No. 1 in2022.

    Axonics®sacral neuromodulation systems provide adults with overactive bladder and/or fecal incontinence with long-lived, easy to use, safe, clinically effective therapy. In addition, Axonics’ best-in-class urethral bulking hydrogel, Bulkamid®, provides safe and durable symptom relief to women with stress urinary incontinence. In theU.S., moderate to severe urinary incontinence affects an estimated 28 million women and fecal incontinence affects an estimated 19 million adults. For more information, visitwww.axonics.com.

    Use of Non-GAAP Financial Measures

    To supplement Axonics’ consolidated financial statements prepared in accordance with generally accepted accounting principles (GAAP),Axonicsprovides certain non-GAAP financial measures in this release as supplemental financial metrics.

    Adjusted EBITDA is calculated as net loss before other income/expense (including interest), income tax expense (benefit), depreciation and amortization expense, stock-based compensation expense, acquisition-related costs, cash compensation in lieu of equity compensation due to pending merger, one-time litigation-related expense, acquired in-process research and development expense, loss on disposal of property and equipment, and expense related to impairment of intangible assets. Management believes that in order to properly understand short-term and long-term financial trends, investors may want to consider the impact of these excluded items in addition to GAAP measures. The excluded items vary in frequency and/or impact on our results of operations and management believes that the excluded items are typically not reflective of our ongoing core business operations and financial condition. Further, management uses adjusted EBITDA for both strategic and annual operating planning. A reconciliation of adjusted EBITDA reported in this release to the most comparable GAAP measure for the respective periods appears in the table captioned “Reconciliation of GAAP Net (Loss) Income to Adjusted EBITDA” later in this release.

    The non-GAAP financial measures used byAxonicsmay not be the same or calculated in the same manner as those used and calculated by other companies. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for Axonics’ financial results prepared and reported in accordance with GAAP. We urge investors to review the reconciliation of these non-GAAP financial measures to the comparable GAAP financial measures included in this press release, and not to rely on any single financial measure to evaluate our business.

    Cautionary Statement Regarding Forward-Looking Statements

    This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of theU.S.Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words like “may,” “will,” “likely,” “should,” “expect,” “anticipate,” “future,” “plan,” “believe,” “intend,” “goal,” “seek,” “endeavor,” “estimate,” “project,” “continue,” and variations of such words and similar expressions. These forward-looking statements are not guarantees of future performance and involve risks, assumptions, and uncertainties, including, but not limited to, risks related to: Axonics’ ability to consummate the transactions contemplated by the Agreement and Plan of Merger, datedJanuary 8, 2024(the “Merger Agreement”), by and amongAxonics, Boston Scientific Corporation (“Boston Scientific”), andSadie Merger Sub, Inc., a wholly owned subsidiary of Boston Scientific (“Merger Sub”), providing for the merger of Merger Sub with and intoAxonicswithAxonicscontinuing as the surviving company and a wholly owned subsidiary of Boston Scientific (the “Merger”), in a timely manner or at all; the risk that the Merger Agreement may be terminated in circumstances requiring the payment byAxonicsof a termination fee; the satisfaction (or waiver) of the conditions to the closing of the Merger; potential delays in consummating the Merger; the occurrence of any event, change or other circumstance or condition that could give rise to termination of the Merger Agreement; Axonics’ ability to timely and successfully realize the anticipated benefits of the Merger; the ability to successfully integrate the businesses ofAxonicsand Boston Scientific; the effect of the announcement or pendency of the Merger on Axonics’ current plans, business relationships, operating results and business generally; the effect of limitations placed on Axonics’ business under the Merger Agreement; significant transaction costs and unknown liabilities; litigation or regulatory actions related to the Merger Agreement or Merger; FDA or otherU.S.or foreign regulatory or legal actions or changes affectingAxonicsor Axonics’ industry; the results of any ongoing or future legal proceedings, including the litigation withMedtronic, Inc.,Medtronic Puerto Rico Operations Co.,Medtronic Logistics LLCandMedtronic USA, Inc.(the “Medtronic Litigation”); any termination or loss of intellectual property rights, including as a result of the Medtronic Litigation; introductions and announcements of new technologies byAxonics, any commercialization partners or Axonics’ competitors, and the timing of these introductions and announcements; changes in macroeconomic and market conditions and volatility, including the risk of recession, inflation, supply chain constraints or disruptions and rising interest rates; and economic and market conditions in general and in the medical technology industry specifically, including the size and growth, if any, of Axonics’ markets, and risks related to other factors described under “Risk Factors” in other reports and statements filed with theU.S. Securities and Exchange Commission(“SEC”), including Axonics’ most recent Annual Report on Form 10-K, which is available on the investor relations section of Axonics’ website atwww.axonics.comand on the SEC’s website atwww.sec.gov. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by these forward-looking statements. Therefore, you should not rely on any of these forward-looking statements.

    The forward-looking statements included in this press release are made only as of the date of this press release, and except as otherwise required by federal securities law,Axonicsdoes not assume any obligation nor does it intend to publicly update or revise any forward-looking statements to reflect new information, changed circumstances or unanticipated events.

    Axonics, Inc.

    Consolidated Balance Sheets

    (in thousands, except share and per share data)

    September 30,

    December 31,

    2024

    2023

    (unaudited)

    ASSETS

    Current assets

    Cash and cash equivalents

    $

    239,452

    $

    104,811

    Short-term investments

    105,773

    240,149

    Accounts receivable, net of allowance for credit losses of$1,198and$442atSeptember 30, 2024andDecember 31, 2023, respectively

    62,644

    57,243

    Inventory, net

    113,861

    79,940

    Prepaid expenses and other current assets

    4,184

    9,279

    Total current assets

    525,914

    491,422

    Restricted cash

    22,082

    12,714

    Property and equipment, net

    20,698

    10,760

    Intangible assets, net

    78,454

    81,375

    Other assets

    22,478

    24,235

    Goodwill

    104,545

    99,417

    Total assets

    $

    774,171

    $

    719,923

    LIABILITIES AND STOCKHOLDERS’ EQUITY

    Current liabilities

    Accounts payable

    $

    20,109

    $

    18,452

    Accrued liabilities

    5,701

    10,527

    Accrued compensation and benefits

    35,998

    15,060

    Operating lease liabilities, current portion

    2,611

    1,777

    Total current liabilities

    64,419

    45,816

    Operating lease liabilities, net of current portion

    29,900

    25,840

    Deferred tax liabilities, net

    15,363

    10,703

    Total liabilities

    109,682

    82,359

    Commitments and contingencies

    Stockholders’ equity

    Preferred stock, par value$0.0001per share; 10,000,000 shares authorized, no shares issued and outstanding atSeptember 30, 2024andDecember 31, 2023

    —

    —

    Common stock, par value$0.0001, 75,000,000 shares authorized atSeptember 30, 2024andDecember 31, 2023; 51,110,021 and 50,770,520 shares issued and outstanding atSeptember 30, 2024andDecember 31, 2023, respectively

    5

    5

    Additional paid-in capital

    1,063,185

    1,033,778

    Accumulated deficit

    (392,586

    )

    (380,352

    )

    Accumulated other comprehensive loss

    (6,115

    )

    (15,867

    )

    Total stockholders’ equity

    664,489

    637,564

    Total liabilities and stockholders’ equity

    $

    774,171

    $

    719,923

    Axonics, Inc.

    Consolidated Statements of Comprehensive Income (Loss)

    (in thousands, except share and per share data)

    (unaudited)

    Three Months Ended

    September 30,

    Nine Months Ended

    September 30,

    2024

    2023

    2024

    2023

    Net revenue

    $

    116,193

    $

    93,100

    $

    322,167

    $

    256,644

    Cost of goods sold

    26,542

    23,996

    74,120

    64,850

    Gross profit

    89,651

    69,104

    248,047

    191,794

    Operating expenses

    Research and development

    13,491

    8,167

    37,339

    25,172

    General and administrative

    23,761

    11,778

    55,192

    34,659

    Sales and marketing

    52,972

    47,544

    160,607

    134,468

    Amortization of intangible assets

    2,221

    2,302

    6,722

    6,803

    Acquisition-related costs

    3,474

    —

    9,953

    2,368

    Acquired in-process research & development

    —

    —

    —

    15,447

    Total operating expenses

    95,919

    69,791

    269,813

    218,917

    Loss from operations

    (6,268

    )

    (687

    )

    (21,766

    )

    (27,123

    )

    Other income (expense)

    Interest and other income

    4,704

    4,271

    13,379

    12,149

    Interest and other expense

    8

    (83

    )

    (83

    )

    774

    Other income, net

    4,712

    4,188

    13,296

    12,923

    (Loss) income before income tax (benefit) expense

    (1,556

    )

    3,501

    (8,470

    )

    (14,200

    )

    Income tax (benefit) expense

    (1,535

    )

    (427

    )

    3,764

    (1,538

    )

    Net (loss) income

    (21

    )

    3,928

    (12,234

    )

    (12,662

    )

    Foreign currency translation adjustment

    10,438

    (6,185

    )

    9,752

    636

    Comprehensive income (loss)

    $

    10,417

    $

    (2,257

    )

    $

    (2,482

    )

    $

    (12,026

    )

    Net (loss) income per share, basic

    $

    (0.00

    )

    $

    0.08

    $

    (0.24

    )

    $

    (0.26

    )

    Weighted-average shares used to compute basic net (loss) income per share

    51,088,073

    49,244,981

    51,010,885

    48,973,252

    Net (loss) income per share, diluted

    $

    (0.00

    )

    $

    0.08

    $

    (0.24

    )

    $

    (0.26

    )

    Weighted-average shares used to compute diluted net (loss) income per share

    51,088,073

    50,086,491

    51,010,885

    48,973,252

    Axonics, Inc.

    Net Revenue by Product and Region

    (in thousands)

    (unaudited)

    Three Months Ended

    September 30,

    Nine Months Ended

    September 30,

    2024

    2023

    2024

    2023

    Sacral neuromodulation

    United States

    $

    90,072

    $

    72,212

    $

    248,988

    $

    198,270

    International

    2,277

    1,737

    6,255

    5,025

    Sacral neuromodulation total

    $

    92,349

    $

    73,949

    $

    255,243

    $

    203,295

    Bulkamid

    United States

    $

    19,050

    $

    15,579

    $

    52,575

    $

    41,998

    International

    4,794

    3,572

    14,349

    11,351

    Bulkamid total

    $

    23,844

    $

    19,151

    $

    66,924

    $

    53,349

    Total net revenue

    $

    116,193

    $

    93,100

    $

    322,167

    $

    256,644

    Axonics, Inc.

    Reconciliation of GAAP Net (Loss) Income to Adjusted EBITDA

    (in thousands)

    (unaudited)

    Three Months Ended

    September 30,

    Nine Months Ended

    September 30,

    2024

    2023

    2024

    2023

    GAAP Net (loss) income

    $

    (21

    )

    $

    3,928

    $

    (12,234

    )

    $

    (12,662

    )

    Non-GAAP Adjustments:

    Interest and other income

    (4,704

    )

    (4,271

    )

    (13,379

    )

    (12,149

    )

    Interest and other expense

    (8

    )

    83

    83

    (774

    )

    Income tax (benefit) expense

    (1,535

    )

    (427

    )

    3,764

    (1,538

    )

    Depreciation and amortization expense

    3,215

    3,254

    9,298

    9,295

    Stock-based compensation expense

    8,231

    11,470

    26,393

    33,388

    Acquisition-related costs

    3,474

    —

    9,953

    2,368

    Cash compensation in lieu of equity compensation due to pending merger

    10,404

    —

    21,586

    —

    One-time litigation-related expense

    4,500

    —

    4,500

    —

    Acquired in-process research & development

    —

    —

    —

    15,447

    Adjusted EBITDA

    $

    23,556

    $

    14,037

    $

    49,964

    $

    33,375

    View source version onbusinesswire.com:https://www.businesswire.com/news/home/20241107091750/en/

    Axonicscontact:Neil BhalodkarIR@axonics.com

    Source:Axonics, Inc.

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